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Key Highlights:
- Luxury leather items such as high-end handbags and high-quality wallets are subject to 18% GST, influencing luxury brand pricing strategies.
- HSN code 4202 includes briefcases, handbags, trunks, and wallets, and hence it is the largest classification for travel and personal accessories.
- The 42021 HSN code is an important classification for certain leather items and travel accessories, which enables companies to charge the right 18% GST and ensure the right compliance.
- Accurate leather HSN code classification prevents incorrect tax computation, penalties, and input tax credit claims, thus making compliance important for businesses.
Leather items, travel items, handbags, and saddlery are significant in the fashion, travel, and equestrian sectors. These items are used extensively worldwide, and therefore, businesses and traders need to know their taxation regime under the Goods and Services Tax (GST) .Chapter 42 of the harmonised system of nomenclature (HSN) includes different articles of leather or leather substitutes, such as saddlery, harnesses, handbags, wallets, and travel bags. The GST tax rates applicable to these articles differ based on their category. Hence, businesses must follow proper taxation guidelines to ensure accurate compliance and cost planning.This article gives a comprehensive overview of GST rates and HSN codes for articles of leather and allied goods so that manufacturers, importers, and traders find it easy to move under taxation. Also Read - Know the rules of GST invoicing
HSN Codes for Articles of Leather and Allied Goods
HSN codes assist in product classification for taxation. The major leather HSN codes that are relevant under Chapter 42 are as follows:
| HSN Codes | Export and Import HSN Codes | Products Description | Rates (%) |
| 4201 | 42010000 | Saddleryconsistsofharnesses of anytypefor any animal,suchasdog coats, traces, leashes, knee pads, muzzles, saddle cloths, and saddle bags | 18% |
| 4202 | 42021110, 42021120, 42021130, 42021140, 42021150, 42021160, 42021170, 42021190, 42021220, 42021230, 42021240, 42021250, 42021260, 42021270, 42021280, 42021290, 42021910, 42021920, 42021930, 42021940, 42021950, 42021960, 42021990, 42022110, 42022120, 42022190, 42022290, 42022990, 42023110, 42023120, 42023190, 42023210, 42023290, 42023910, 42023990, 42029100, 42029200, 42029900 | Exceptforleather or composition leather, school satchels, and bags or tote bags | 18% |
| 4202 | 42021110, 42021120, 42021130, 42021140, 42021150, 42021160, 42021170, 42021190, 42021220, 42021230, 42021240, 42021250, 42021260, 42021270, 42021280, 42021290, 42021910, 42021920, 42021930, 42021940, 42021950, 42021960, 42021990, 42022110, 42022120, 42022190, 42022290, 42022990, 42023110, 42023120, 42023190, 42023210, 42023290, 42023910, 42023990, 42029100, 42029200, 42029900 | Trunks, suitcases, executive cases, briefcases, school satchels, spectacle cases, binocular cases, camera cases, musical instrument cases, gun cases, holsters, andthelike; travelling bags, insulated food or beverage bags, toilet bags, rucksacks, handbags, shopping bags, wallets, purses, map cases, cigarette cases, tobacco pouches, tool bags, sports bags, bottle cases, jewellery boxes, powder boxes, cutlery cases, andthelikeof leather, plastic sheeting, textile materials, vulcanised fibre, or paperboard, orwhollyorsubstantiallycoveredtherewith. | 18% |
| 4202 | 420222 , 420229 , 42023110 , 42023190 , 420232 , 420239 | pouchesandpursesfor handbags; jewellery box | 12% |
| 4203 | 42031010, 42031090, 42032110, 42032120, 42032910, 42032920, 42032930, 42033000, 42034010, 42034020, 42034090 | Gloveswhich aremadeespeciallyforsportsuse | 12% |
| 4203 | 42031010, 42031090, 42032110, 42032120, 42032910, 42032920, 42032930, 42033000, 42034010, 42034020, 42034090 | Leather or composition leatherproductsforaccessoriesandclothes(otherthangloves madespeciallyfor sportspurposes) | 18% |
| 4205 | 42050011, 42050019, 42050020, 42050090 | Otherleather or leatherproductitems | 18% |
| 4206 | 42060010, 42060090 | Productsfrom thegoldbeater's skin,tendons, bladders,or the stomach (otherthanfrom silkworm gut) | 18% |
| 42022910 | – | Handbagsofothermaterialsthanbasketryorwicker | 18% |
| 42022240 | – | Vanity bags | 18% |
| 42022230 | – | Jutehandbags andshoppingbags | 12% |
| 42022220 | – | Cotton shopping bags and handbags | 12% |
| 42022210 | – | Syntheticplasticbags andsynthetic plastichandbags | 18% |
| 42021210 | – | Toilet cases | 18% |
Also Read - Know how to make and generate the GST e-way bill
Understanding the Impact of GST and Complying with the Norms
The GST rate and classification of leather items, travel bags, and saddlery have a huge bearing on prices and trade in the sector. With different GST rates of 12% and 18%, companies need to be very cautious about classifying their products under the right leather HSN codes to comply and save costs.Knowledge about the HSN codes 4201, 4202, 4203, and 4205 assists enterprises in tax filing, cost control, and claiming input tax credits. For retailers, importers, and manufacturers, keeping up with GST rules makes transactions easier and helps keep prices competitive. For your business, the GST calculator can help calculate your tax liability so that you can file accurate GST returns.With a well-designed GST structure, companies can concentrate on growth, innovation, and international expansion while being tax-compliant.
FAQS - FREQUENTLY ASKED QUESTIONS
What is the HSN code for almonds?
Almonds are classified under HSN Code 0802. Raw almonds, either shelled or unshelled, attract 5% GST, whereas processed almonds (roasted, salted, or flavoured) attract 12% GST under HSN Code 2008.
What is the GST rate for raw almonds?
Raw almonds, both shelled and unshelled, are subject to 5% GST under HSN Code 0802. The 5% GST is charged on: Whole raw almonds (unshelled), Shelled almonds (with no processing), and Almonds in bulk for direct consumption or further processing.
Are roasted and salted almonds taxed differently than raw almonds?
Yes, roasted and salted almonds are in the category of processed food (HSN Code 2008) and are subject to 12% GST. Roasting and salting change the original form of the product and make it a processed and value-added food item.
How much is GST on cashew nuts?
Cashew nuts are covered under HSN Code 0801, and their GST depends on whether raw or processed: Raw cashew nuts (unshelled or shelled) charge 5% GST, and roasted, salted, or flavoured cashews are taxed at 12% GST under HSN Code 2008.
Do pistachios and walnuts attract GST?
Yes, but the rate of GST depends on their form: Unshelled and shelled raw pistachios and walnuts draw 5% GST under HSN Code 0802, and Flavoured, salted, roasted pistachios and walnuts draw 12% GST under HSN Code 2008.
What is the rate of GST applicable to nut butter like almond butter?
Spreads made from nuts like almond butter, cashew butter, and peanut butter are under the badam HSN Code 2008 and subject to 18% GST.
Can businesses claim an Input Tax Credit on GST on nuts?
Yes, businesses procuring almonds, cashews, walnuts, etc., for manufacturing or resale can claim Input Tax Credit (ITC) on GST. But this is subject to:
The type of business (e.g., wholesalers, retailers, and food manufacturers are eligible to claim ITC).
The rate of GST applicable to the product (5%, 12%, or 18%).
Whether the invoice for purchase indicates GST information and badam HSN codes.
Do imported nuts and almonds draw extra GST?
Yes, imported nuts and almonds draw Basic Customs Duty (BCD) along with GST, based on their classification. For instance:
Raw almonds draw 5% GST + customs duty at the import level
Processed almonds (roasted, salted) draw 12% GST + customs duty
Importers have to pay customs duty and GST upfront before selling the nuts in the Indian market.
Do traders need to include almond HSN codes in invoices for selling nuts?
Yes, according to GST rules, companies are required to implement HSN code reporting regulations depending on turnover:
Companies with turnover over ₹5 crores need to include the complete HSN code (e.g., 0802 for almonds) in GST invoices
Companies with turnover of less than ₹5 crores need to include only a 2-digit HSN code (e.g., "08" for nuts).
Correct reporting of HSN codes facilitates compliance and ensures tax calculations are accurate.
Are nut chocolates taxed at the same HSN code as raw nuts?
No, nut chocolates and nut-filled confectionery products are classified under HSN Code 1806 and are charged 18% GST. These include added sugar, milk, and other ingredients and are distinct from raw or roasted nuts.
The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.
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